Directed Technical Change Of China’s Agriculture Product Safety

With the development of global economy, food safety has been the focus of the world issues of common concern. Agro-product safety is the primary link. Nevertheless, based on the assumption of given technique, most of the exiting literature have not offered satisfactory explanation to the occurrence of food safety issues at the source. In fact, agriculture technical progress plays an important role in the course of agro-product and the direction of technical progress is of key importance to safety of agro-product. A satisfactory economic research framework on food safety policy should include the endogenous policy response of directed technology progress. The paper takes an important agriculture productive technology, pesticide, as the research object, carries out the empirical analysis on the phenomenon of "adverse selection" in the market of pesticide technology with the binary choice logistic model. It incorporates agriculture technology progress direction into the endogenous growth model of Acemoglu(2002,2009) et al., conducts a ADTC model and particular emphasis the situation of e<l,which is very different from the DTC model, depicts the different innovation behavior dynamically. The paper also conducts a technology diffusion model of pesticide, measures two kinds of diffusion velocity accurately. Subsequent case studies offer powerful proofs for the above-mentioned analysis. The paper broadens the application range of DTC model, expends marginally the exiting agriculture technology progress theory, which offers a new idea to solve the issues of agro-product safety (including food safety). The main conclusions are as follows:(1) "The adverse selection" phenomenon of different direction of pesticide technical progress in technique market is the surface reason of agro-product safety issue. In China, "the adverse selection" exits both in macro and micro level. "Unsafe" technology is easier adopted than "safe" ones. The excessive/abuse use of pesticide, especially chemical pesticide, severely impacts the agro-product safety in China. The analysis of micro-data indicates that several factors, including the personal feature, family feature, knowledge about bio-pesticide and consciousness of agro-product influence the peasant households’ choice.(2) The underlying causes of agro-product issue could be traced back to the dynamic variation of two direction of agriculture technology progress. Directed technology progress of pesticide and its diffusion influence the safety of agro-product from the source. The direction depends on the relatively expected revenue of innovation activity of two departments. When e<1, innovation occurs firstly in unsafe department and the unsafe technology diffuses at a faster velocity than safe ones. In laissez-faire economy, the disaster of agro-product safety is inevitable because the direction of technology progress could not be adjusted. The model demonstrates that a social planner could guide the direction of technology progress by policy tools, optimize allocation of the innovation resource and eliminate the problems of agro-product safety at its source.(3)The empirical analysis results show that the relationship between bio-pesticide and chemical pesticide has obviously complementary characteristics, which is very different from DTC model. The econometric analysis about Chinese bio-pesticide industry during 2000-2012 shows that the indicators such as technology progress level, technology diffusion velocity and technological progress contribution rate are far below than the chemical pesticide industry in the same period.(4)Different technology diffusion velocity between the two kinds of technology progress causes "the adverse selection" phenomenon in technology market. Two case studies offer powerful proofs for the conclusion. The case of Zhejiang fly net covered red bayberry technology indicates that the diffusion velocity and effect are decided by the micro-factors such as the dynamic innovation, "the learning by doing" effect and adopters’ heterogeneity behavior, etc. Another case about the Taiwan farmers’ entrepreneurial parks (TFEP) indicates that diffusion effect of TFEP are decided by the factors such as famers’ character, policy, market and social environment, etc.(5)It is feasible to solve the problem of Chinese agro-product safety from the perspective of direction of agriculture technology progress. The effective policy regulation should be includes the direction of pesticide technology progress, the process of pesticide technology diffusion and the process of pesticide technology adoption. A dynamic framework includes direction of pesticide technology progress, pesticide technology diffusion, pesticide technology adoption and policy regulation deconstructs systematically how the direction of technology progress affects the safety of Chinese agro-product safety.Based on the above results, the paper puts forward policy recommendations from three perspectives.